This week, NAR submitted a formal comment on the Financial Crime Enforcement Network’s (FinCEN) notice of proposed rulemaking regarding Anti-Money Laundering Regulations for Residential Real Estate Transfers. FinCEN, with this proposed rule, is seeking to develop a more formal framework for tracking and reporting non-financed, all-cash residential real estate transactions with the goal of eliminating the Geographic Targeting Orders (GTOs), which have been in place since 2016. Additionally, FinCEN is seeking to work to effectively combat money laundering and illicit financial crimes involving real estate. The proposed rule outlines a cascading reporting mechanism where settlement agents, title agents, and attorneys would be primarily responsible for filing new “Real Estate Reports” with FinCEN. While NAR believes that a predictable and consistent framework is needed, NAR remains concerned about the cost of compliance for this proposed rule, and that the rule is too broad in scope by requiring the reporting of transfers of real estate that are not likely high risk in nature in any way.
NAR also recently met with the Treasury Department along with industry stakeholder to discuss this rule. NAR supports risk-based and pragmatic solutions to combat money laundering and illicit financing involving real estate.
NAR will continue to provide updates regarding anti-money laundering developments.